Amendment to the American Arbitration Association Construction Industry Arbitration Rules

By: Christopher Solop and Lynn Thompson

Effective March 1, 2024, the American Arbitration Association amended the Construction Industry Arbitration Rules.  One notable change is to the threshold for Fast Track Procedures that raised the qualifying claim or counterclaim amount from $100,000 to $150,000.  It is not uncommon for disputes to fall within the range provided for proceeding under the AAA Fast Track.  The Fast Track Procedure permits the parties to have their case heard “no later than 45 calendar days after the date of the preliminary telephone conference, unless all parties and the arbitrator agree otherwise…” (Emphasis added.)  An award decision also is required to be issued “not later than 14-calendar days from the date of the closing of the hearing…” as opposed to the 30-calendar day requirement for regular track arbitration.  The form of the award is specified under Rule F-13 as a standard award.  If the parties request another type of award such as a reasoned award, the arbitration will be removed from the Fast Track Procedure.  Caution should therefore be used in requesting an award other than a standard award.

There are also several procedural changes to the Regular Track Procedure, notably Rule R-45 regarding confidentiality that requires the AAA and the arbitrator to keep all matters confidential. Regarding confidentiality, contractors should consider placing a provision in their arbitration clause expressly providing that all matters related to the arbitration are confidential and that only the parties to the arbitration, their counsel and witnesses are be permitted to attend the arbitration proceeding.   

The March 1, 2024, revisions to the Construction Industry Rules can be found at  https://www.adr.org/Rules